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Month: December 2015

Ann, the Prospective Client: Along with the goals for the company that we already talked about, what I really want to do is position the business for sale starting now and then get ready to retire…what I’m thinking is…and then we should…hello…Jim…are you with me?

Jim, the Professional Services Provider: Ummm…oh, yeah. Long-term growth for the company. Right, Ann. Well what you really need is to protect your personal assets while we pursue angel funding. I can help you with both of these.

Ann: Long-term growth? Well, I’m not really sure that’s the path we’re headed down, but you’re the expert. I’d at least like to see what you’re thinking. When can you put together a written proposal for me? Jim?

Jim: One sec…(Gets off his cell phone) I hear ya barkin’ there, Ann. I’ll get in that proposal and get things moving. I can have that overnighted to you (checks calendar…flips pages) in 43 days or so. I can’t commit 100%, though. It’s been busy…

Somebody Else’s Problem?
I know what you’re thinking. “This is an over dramatization of the mistakes of a particularly bad consultant. Sure, it’s always good for me to reread, but I’m past the stage of needing to hear this. I listen. I understand my clients’ needs. I get back to them quickly. I act professionally at all times.”

You may very well be a client satisfaction machine, pleasing clients with your charm, wisdom, skills and promptness. But, odds are you’re wrong — at least according to your typical clients.

In “How Clients Buy: The Benchmark Report on Professional Services Marketing and Selling from the Client Perspective”* we asked the following question to 200 business-to-business buyers of consulting and professional services:

Think about the last few times you purchased professional services. Which, if any, of the following 15 problems did you encounter?

And The Verdict Is

Inattentive: 41% encountered service providers that did not listen to them (Hello…Jim…are you with me?).

Clueless: 40% encountered service providers that did not understand their needs (Long-term growth…Well, I’m not really sure that’s the path we’re headed down).

Late: 38% encountered service providers that did not respond to their requests in a timely manner (in 43 days or so).

The other 12 problems (e.g. service provider lacked professionalism ‘gets off cell phone’, service provider did not craft a solution to my needs ‘pursue angel funding’, etc.) occur regularly, too. Or, you could say, too regularly. In fact, only 15% of buyers reported that they experience no such problems in the process of purchasing services.

What It Comes Down to
85% of business-to-business buyers report they recently experienced one or more major problem with the person selling in the process of purchasing services.

These problems may be somebody else’s, not yours. 85 out of 100 buyers could be dead wrong. Keep thinking that…and keep fumbling opportunities to win new clients.

What Difference Does it Make?
“If a spaceship is traveling at the speed of light, and you turn the headlights on, does anything happen?” — Steven Wright

Many service providers wonder, “If I stop doing what I’m doing (i.e. business development and delivering services), to work on selling effectiveness, will it make a difference?”

According to decision makers who buy services, the answer is unequivocally, “Yes.”

In “How Clients Buy: The Benchmark Study of Professional Services Marketing and Selling from the Client Perspective”, we asked decision makers not only what problems they encountered, but what difference it would make if the service providers fixed these problems.

Here is What They Had to Say

If service providers listened during the business development process, 74% of buyers would be “much more likely” to consider purchasing services.

If service providers understood the needs of the prospect better, 76% of buyers would be “much more likely” to consider purchasing their services.

If service providers responded to prospect requests in a timely manner, 42% of buyers would be “much more likely” to consider purchasing services (and 52% would be “somewhat more likely” for a whopping total of 94%).

As you can see, according to the decision makers who have experienced these problems — and a host of other problems — when buying consulting and professional services, solving them would make a huge difference in their purchasing decision.

Where Do Your Challenges Lie?
Let’s assume you have made the decision to address mistakes you may be making when you are selling. What do you do now?

First, get a sense of what specific problems crop up when you are selling. Which errors do you typically make? Uncovering which problems follow you around isn’t necessarily as easy as it sounds, but it can be done. To uncover your problems:

Be honest with yourself. If you can’t admit that you have any issues, no strategies for improving will work for you.

Make a list. If you know what you are looking for, you are more likely to find it.

Pay attention. Once you have your list, simply paying attention to whether the problems are cropping up can help you to uncover them.

Bring someone else along. Sometimes you simply can’t recognize problems in your selling process by yourself. If you bring someone else along to observe and then coach you, you are likely to not only uncover problems in your process, but to start solving them immediately.

Ask your clients and prospects. We have found that clients want to help you be a better service provider. Merely by asking, “When we were in the process of figuring out whether we were going to work together, how did I do? Where could I improve? What feedback do you have?” can actually strengthen your relationship.

Make sure you also contact (or have a third party contact) buyers who chose not to engage your services. What you learn from them may not only be eye opening, it could immediately save you from continuing to make costly errors.

Fix It…You Can’t Go Wrong
Let’s assume you now know you have several areas where you can improve. Picking which one to work on first is a whole new challenge. But in this case, just pick one to fix. You can’t go wrong.

Each of the 15 problems clients reported had subtle differences in impact on their decision making process. This should not overshadow the fact that, for every problem they experienced, 85% or more of these decision makers report that an improvement would make them at least “somewhat more likely” to consider purchasing the provider’s services. With this in mind, any one improvement can make a world of difference in your selling process.

So, pick something to improve! And, tell your friends so that the next time we survey 200 decision makers we won’t find clueless, late and inattentive, but instead hear intelligent, punctual and focused.

It’s the last week of the month (or perhaps the quarter). Each Sales Rep has cranked up their individual “sunshine pump” and provided their Sales Manager with their best guess as to what sales will close during this period. Taking this information, the Sales Managers feed it into their own industrial strength sunshine pumps, and pass it up to the VP of Sales. He, in turn, feeds that information into his own twin cylinder, turbocharged sunshine pump, and feeds the result to the CFO and CEO with his forecast.

While this scenario takes place like clockwork in virtually every organization that sells products and/or services, one of the first questions I ask CFO’s is if they actually commit and spend available funds based on the forecast that the VP of Sales just provided. After the initial laughter dies down, I ask three questions:

What has been their experience regarding the accuracy of the monthly (quarterly) forecast?

What correction factor is applied to the numbers that the VP of Sales provided?

How much time is spent, across the entire organization, producing the forecast?

The overwhelming majority of the time, I receive the following typical responses:

The accuracy of the forecast is somewhere between 40-60%

A 40-50% “fudge factor” is used

Between 80 to 100 total man hours per forecast

The logical conclusion of this is to wonder why so much of the organization’s energy and resources are regularly devoted to producing a forecast that is so unreliable that an arbitrary correction factor is routinely applied?

Why Bad Things Happen To Good People

I believe, that the reasons for such an abysmally poor forecasting scorecard, may be linked to 2 primary areas:

Asking Sales Reps to forecast their own sales

Lack of established uniform pipeline grading milestones

Let’s face it, asking individual Sales Reps (especially underachieving Sales Reps) to forecast their own sales is the equivalent to asking the U.S. Congress to voluntarily pass meaningful campaign finance reform … and we know how successful that has been. Asking the Sales Rep, who is only 70% of quota a week before the end of the period, to admit to his Sales Manager that he will yet again fail to meet expectations, is a waste of time. The Sales Rep will say what he has to get the Sales Manager off his back … and to try to keep both his job and his expense account. During territory reviews in which I’ve participated, it is truly a humbling experience to hear Sales Reps tell their Sales Manager how opportunities that have been in the pipeline, with little or no change for months, will miraculously become active and close “at any moment”. Clearly, it is in the Sales Rep’s best interest to keep the “sunshine pump” cranking out that “sunshine” until the Sales Manager accepts the explanation and goes away.

Since the Sales Manager may have never established and implemented uniform pipeline grading milestones, he has little or no objective criteria on which to grade the status of the opportunity. In this day and age of micro measurement capability, it still amazes me that sales management still asks Sales Reps for their “gut feel” on whether or not an opportunity is going to close in any specific time frame. Wouldn’t it be nice if the “gut feel” of Sales Rep ‘A’ would always be the same as the “gut feel” of Sales Rep ‘B’? In fact, wouldn’t it be nice if the “gut feel” of Sales Rep ‘A’ was at least consistent each time he was queried by his Sales Manager? My own experience indicates that the further the Sales Rep is from his quota, the less accurate his “gut feel” will be. It’s been said that, “you can’t manage what you can’t measure”, and without established uniform pipeline grading milestones, the forecasting process will remain a very dark art rather than the science that it can become.

First Things First

Establishing uniform pipeline grading milestones, and converting that information to accurate forecasts, does not have to be difficult. In fact, for all but the most complex situations, it can be quite simple. All Sales people are familiar with the proverbial sales funnel. Wide at the top and tapering down towards the bottom, it graphically depicts the status of each sales opportunity as it progresses through the buying cycle from initial contact to close. By establishing 5 or 6 intermediate milestones, each based on the stages of the buying cycle, andmeasured by objective, not “gut feel”, criteria, movement through the buying cycle may be tracked … and subsequently forecast with a high degree of accuracy.

Let’s start at the beginning:

Inactive – the sales universe. This initial milestone includes virtually all potential purchasers of your product within the Sales Rep’s assigned territory.

Active – from the sales universe, these include prospects where either proactive or reactive contact has been made, buyer interest has been expressed, and an initial conversation has been scheduled and documented in a letter or e-mail. The easily auditable documentation, and not the Sales Rep’s “gut feel” verbal statements, moves the opportunity from Inactive to Active status.

Goal Shared – the buyer shares their goals with the Sales Rep, their conversation is summarized and documented in a response letter or e-mail, which includes documented recommendations for the next step.

Champion – someone who may not be the decision maker but will introduce the Sales Rep to key players who can. In this stage, the Sales Rep has helped his champion develop a SOLUTION … a vision of himself already in possession, and using, the capability to achieve his goal, the SOLUTION and usage scenario is summarized, access to key players within the organization has been requested, and again, the events have been documented and confirmed.

Evaluating – after initial meetings with key players, their goals have been shared, additional capability visions and usage scenarios have been created, and an evaluation plan (a Sequence of Events) has been proposed, accepted, and documented.

In the Evaluating stage, as each step in the proposed and accepted Evaluation plan is completed, progress is made towards a final decision and, with each step towards the final decision, the likelihood of success increases. While each organization differs, we have found that once an opportunity objectively reaches the Evaluating stage, the Sales Rep will be successful 50% of the time. As each step of the proposed and accepted Evaluation plan is completed, the likelihood of success further increases until one of 4 things happen:

Again, while organizations differ, we have found that opportunities that objectively reach the Verbal stage will be successful 90-95% of the time. Perhaps surprisingly, in opportunities where final proposals have been issued and where the Sales Rep no longer has any control of the buying process, the likelihood of success decreases substantially.

Light At The End Of The ‘Funnel’

As you can see, at each stage of the buying cycle, the common denominator is documentation; usually a letter or e-mail that simply documents and confirms the conversation and events that have occurred. The documentation is easily auditable, as all the Sales Manager has to do to advance the opportunity to the next stage in the buying cycle is review a copy of the documentation. The Sales Rep is not asked to forecast and has no additional administrative burdens beyond what is normally expected in their day to day sales activities. As what may have become more clear, the development of uniform pipeline grading milestones are representative of a sales ‘process’ that permits the Sales Rep to take a prospect from interest development to closure. A second, and perhaps equally valuable, benefit to the use of documentation is that it permits Sales Management to determine if the Sales Rep is selling according to the sales ‘process’ in addition to providing the basis for skill and opportunity coaching to be exercised by Sales Management.

Do not ask Sales Reps to forecast. Instead, ask them to simply document all communications with the client. In short, just ask them to go about doing what is normally expected in their day to day sales activities.

Have Sales Management routinely audit the documentation of the Sales Rep’s completed events.

Have Sales Management produce the forecast, based on documented events and not on the smoke produced by the various corporate “sunshine pumps”.

Perhaps the best part of this process is that all of the “sunshine pumps” are retired, which results in much cleaner “air”, “gut feel” has been eliminated from the process, and, based on a majority of the organizations that implement this type of forecasting process, a forecast accuracy in the 85-90% range is routinely reported … something which both the CFO and CEO can take to the bank.

Are you having a hard time reaching decision-makers, setting up well-qualified appointments, getting past gatekeepers, gathering information or finding if you are calling on an appropriate prospect in the first place? Maybe it seems impossible to get your cold calls returned or you are getting stuck into an endless loop of voice mail. The big problem today in cold calling on businesses is that it is so hard to get a response.

It is a bad situation, but it really doesn’t have to be. This problem often stems from sales training where reps are trained to start selling BEFORE they have determined if there is a need to sell. The problem becomes further compounded when sales representatives think they are speaking with a decision-maker, but they really aren’t. They have the urge to speak about their solutions rather than to ask questions and listen to the complete answers and all of a sudden cold calling becomes really difficult.

Becoming successful at cold calling requires you to switch from the old ‘If I make enough calls, I’ll sell something’ to ‘If I speak with the person who has the authority and need to buy and if I have the right solution to fit their needs, then they will buy’ approach. This approach emphasizes finding the decision-maker(s), using exploratory questions and active listening to gather the information needed to understand who has the authority to buy, if there is a need to buy, and if so, what you should be presenting so the prospect will buy.

Step 1: Establish Call Objectives
Your first objective should be to locate what we will call the ‘WHO’ or decision-maker(s). Second, you need to determine if a need exists. Third, suggest a solution based upon the information you’ve gathered. Fourth, ask for and set up a time and date for specific action steps.

Step 2: Find the Decision-maker(s) First
Before you can find the ‘WHO’, you must first know how to work your way through the maze of a large organization. It is easy to get sidetracked by someone who says he/she has the authority to buy but doesn’t.

There are three approaches into an organization: TOP DOWN (most effective) or SIDEWAYS IN or BOTTOM UP. Whatever direction you choose, remember to seek out the ‘WHO’ first.

The easiest one of the three is the ‘top down’ approach using the power of referral from above. Cold calling goes much easier if you always start at the top of an organization and work your way down. It is much easier to work your way downstream than fight your way up stream.

On your initial call, your goal is to discover ‘WHO’ is responsible for making decisions to buy your type of solution. Start with these questions: “Maybe you can help me? Who is responsible [for your solution]?” “Do you have a [ask for the highest level title] responsible for the final decision to acquire [your solution]?”. Such as, “Do you have a CIO or a CFO?”

This isn’t the time to talk about your solution. Your goal is to find the ‘WHO’ first. A set of questions in this order will keep you out of sales mode and help you stay in information mode. These questions will diminish your fear of rejection and build your confidence since people are usually willing and able to answer them. You’ll also find people less defensive and more helpful when they don’t feel like they are being sold something.

You start by calling the headquarters receptionist and after confirming the address, ask for the name and correct spelling of the CEO (or President, etc.). Next ask to be transferred to the CEO’s assistant.

The advantage of calling the CEO’s assistant is twofold. One is they work and deal with the higher level people (C-level, VPs, etc.) and secondly when they refer you to the person they believe is the ‘WHO’, that person or their office’s gatekeeper will usually take your cold call.

The reason for this is, it is very difficult for a subordinate to refuse a call coming from a superior or a superior’s office (make sure you tell the truth and say you were referred by the CEO’s office). This fact alone eliminates many of the roadblocks such as getting return calls or being put through to the decision-makers themselves. Remember, you DO NOT want to speak with the CEO or President, you want their assistant.

When you are transferred, the first thing you need to say is that you were referred by the CEO’s office (or the CEO if you speak with them).

Using the sideways approach begins with choosing a department such as Investor or Public Relations, Purchasing or Sales. Your objective again is to find the ‘WHO’.

Finding the ‘WHO’ using the bottom up approach begins by calling on people who work in the mail room, an outlying factory, retail location, or customer service and then working your way upwards.

Remember to be flexible and continue transferring to different departments to maximize the value of each call. The objective is to find a live person who will speak with you and provide more pieces of the selling puzzle.

Starting from the top and establishing the who’s who of the organizational hierarchy eliminates a person at a lower level in the organization from saying “Don’t go above me, you deal only with me.” This is because you can mention all the names of the people above.

Step 3: Ask Permission to Speak
From a business perspective, there may be nothing more valuable than our time. Let people know that you respect their time by asking, “Is this a good time to speak?” or “Do you have a few minutes?” before using your opening statement. Not only is this a more professional approach, you’ll find people will offer their full attention since you’ve been given their permission to speak.

If it isn’t a convenient time for your prospect to talk, SCHEDULE A FOLLOW-UP CALL and then HANG UP THE PHONE. Why waste their time or yours? If they are busy, you certainly will not have their attention. Make a good impression by being polite and respectful of the other person’s time.

Step 4: Use Direct Open-Ended Questions
Start by using direct questions such as: “Who is responsible for?” or “How do you currently handle?” or “What are you doing in the area of?” or “When do you plan to make a decision on?” or “Why do you think that is?” Direct questions demonstrate you are in control of the conversation and you know what you are doing.

Avoid using weak questions or statements: “Could you possibly” or “Might you be able to tell me?” or “I’m just trying to find out some information” or “I was hoping to find out” – These type of statements imply a lack confidence.

Step 5: Summarize Your Conversation
At the end, and after any conversation involving action items, summarize verbally and in writing important points and clarify time and date specific next steps. Follow the verbal summary with a written one in an e-mail, and then call to be sure the information was received.

Use a summary email to help you move forward towards the close of a sale. This email provides a detailed summary of what you heard during the conversation, what it means and what are the next steps to be taken, by whom and by when, in order to complete the sale.

In this email include:

Prospect’s Company Background (describe the past and current company situations).

Current Challenge or Situation (list the needs, problems, pains or challenges and why they are occurring).

Timing (specify the evaluation completion and decision dates you have been told).

Evaluation Process (identify who will conduct the evaluation and the criterion that will be used).

Decision Process (note who will be involved in making the decision and how will they decide).

Budget (establish that budget has been set aside or there is access to budget).

The Next Step (layout of the process of who will do what and by when).

A Signature (include your complete contact information and a tag line explaining the benefits of your solution).

Summary
You can make cold calling easier and more effective by starting at the top and by following these steps.

1. Establish call objectives

2. Find the decision-maker(s) first

3. Ask permission to speak

4. Use direct open-ended questions

5. Summarize your conversation

Want to remove fear and rejection from cold calling? View cold calling as an informational puzzle. Your goal is to see how many pieces of information you can get on every call. When you gather information you didn’t have before, you’ve got a result. If you’ve got result then you haven’t been rejected. This puzzle approach will allow you to maximize your valuable selling time by calling on the people who can and will buy from you.